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7 steps to open a savings account for your child

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Kindergarten is a time when your child enjoys show-and-tell and nap time. It’s also when you may consider opening a savings account with your son or daughter.

Your child doesn’t have piles of money to stash away into a savings account. Yet, opening an account with your child will help invest in their financial education — regardless of the balance.

“Don’t feel guilty and feel like there has to be some big balance in it,” says Kathleen Craig, founder and CEO of HTMA, a creator of financial apps for children, a mother and a former community banker. “It’s the act of doing it. It’s the act of teaching them that is so important, more important than the balance.”

A savings account is a tangible teaching tool, so long as you keep the child involved.

Among the life lessons they could learn? Realizing the value of money, planning for future expenses, understanding needs versus wants and fulfilling their goals.

Follow these seven strategies to help your child open a savings account and ensure the experience has a lasting influence.

1. Determine the right age

If you want your child to participate in the process of setting up an account, consider his or her age. Multiple experts believe that when it comes to money management, the sooner, the better. But ultimately, you’re the judge of what age is best to open a youth savings account.

“Take them in when you feel they are ready,” Craig says. “Whether that’s five, whether that’s seven, whether that’s nine or 10, take them in, show them how to open an account at a bank, talk to them about banks or credit unions and take them through the experience so they start getting comfortable with what it is.”

While you may have already opened a college savings account before your child even knew how to speak, view this other savings account as a means to teach him or her about money.

Crystal Boyer, a lifecycle marketing manager at First State Community Bank in Missouri, says kindergarten is usually about when a child can follow the basic banking concepts.

“Six years old is about the time where they really have that ability to understand their money is out of site but still there,” Boyer says. “Because prior to that, they really get excited when they get to go physically put their money in a piggy bank.”

If you have the means to do so, consider giving your child a weekly or monthly allowance, and suggest he or she put a portion aside.

If your child is older, such as a preteen or teenager, look for signs that he or she is interested in a larger purchase. If you hear talk about buying a car or going on spring break, consider suggesting a high-yield savings account as the means to work toward his or her goal.

2. Find the right bank

In your search for a bank for your child, look for an account that requires no minimum balances or low ones (think $1 or $5). Also, look for an account that charges few, if any, fees, and rewards kids with prizes from time to time. Some banks will match your child’s first $5 deposit, for instance. Other institutions may hand out a financial reward when a child has made a certain amount of deposits.

If your child is younger, you may want to pick an institution that you already bank with, so that it’s easy to manage.

No matter what, shop around. Check out Bankrate’s list of the best banks.

3. Go to the bank together

While opening a savings account online can take only a handful of minutes of your time, you probably want to visit a bank with a branch with your child. “You want them to be comfortable in a bank,” Craig says.

Bankers typically make an effort to show children how to record transactions and complete the forms for withdrawal and deposit slips. Bankers may even give the child a prize for opening an account as well as ring a bell in the branch to celebrate the milestone.

Depending on the age of your child, bankers might go over the basics of online banking and mobile banking as well.

During the visit, ask about accounts with specific benefits for youngsters. Some institutions may even make a small deposit in their savings account to reward kids for getting good grades.

If they’re older, consider all your financial institutions options, including online-only banks because they typically pay more interest than brick-and-mortar banks. You can compare top online banks on Bankrate.

4. Fund the account

While every institution is different, each bank and credit union will let you fund your child’s account in multiple ways. You could make a deposit via check or cash at a branch. You may be able to fund the account by making a deposit into it at the ATM. You can also make a transfer from your account into your child’s account.

“It’s a mix of everything,” says Danielle Anderson, a youth program supervisor at Altra Federal Credit Union in Onalaska, Wisconsin.

One word of advice: Avoid making it a one-time event. Craig recommends committing to going to the branch at least three times a year to make deposits. Again, don’t sweat making large ones. A couple of dollars will illustrate the lesson just as much as a larger deposit would.

5. Explain the perks of interest

If your child has an interest-bearing account, go over the monthly statement together or check the account balance on a mobile app. Remember, the amount doesn’t have to be large to hit home.

“They can actually see, ‘I didn’t put this money in here. This money came from the bank,’” Boyer says. “Even if it’s a nickel, it’s still something the bank gave me that they didn’t have to put in.”

In addition, your child may be interested in websites that further instill financial basics. A few to try: and

You may also consider reading books for kids about money. Boyer suggests “Alexander, Who Used to be Rich Last Sunday” and “Lemonade in Winter: A Book About Two Kids Counting Money.”

6. Set goals

While saving for special items can help your child learn patience and diligence, keep goals age-appropriate. It might be difficult, for instance, for a 5-year-old to save for an entire year before making a purchase. Start with smaller goals instead.

Then help them visualize their progress.

Consider making a chart, such as a drawing of a vertical tube with different amounts marked on it. Place the goal amount at the top and put the chart on the refrigerator in your kitchen or the child’s bedroom door. Some institutions will give your child a physical moon jar with three buckets — “save,” “spend” and “share” — to help spark conversations on personal finance lessons.

For older children, set longer goals, such as saving for a year for a car. Help your child track progress by regularly checking the account online.

Teenagers might want to segment their savings into two areas: long-term savings for college and short-term savings for items such as a new tablet or game system.

7. Try mobile banking apps

If your children are young, there’s a reasonable chance you don’t want to give them access to money movement features on a mobile banking app. On the other hand, you know your child will want to use an app just as he or she likes to play Angry Birds or My Little Pony.

So, you may want to consider getting your child to use a financial literacy app. RoosterMoney, for example, targets children as young as 4 years old with an app designed to help them keep track of their allowance. Apps such as Savings Spree and Bankaroo also focus on financial literacy lessons. Banker Jr., an app created by Craig and offered through financial institution partners, is another option to train young children to save. On the Banker Jr. app, your children can track allowance and chores, set up financial goals and play games that are designed to teach them about personal finance concepts. For instance, a child could play Piggums Candy Factory in the app, a game designed to teach them about coinage.

When choosing a financial literacy app, be mindful of their age — while you might not think two years will make a difference, they could.

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Written by
Mary Wisniewski
Banking editor
Mary Wisniewski is a banking editor for Bankrate. She oversees editorial coverage of savings and mobile banking articles as well as personal finance courses.  
Edited by
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